TymeBank Had a Really Great Year – Where to Next?
TymeBank is one of the new banks which launched during 2019. You may well have seen their branding on display at Pick n Pay (a partner of theirs) or perhaps online.
2019 has been a really great year for the new online bank. In under a year they have managed to sign up 1 million new customers. This means that this brand new bank now has a similar number of client accounts as African Bank (the new African Bank not the old one that fell apart because it loaned money to a lot of people who couldn’t repay their debts).
Admittedly, of the 1 million accounts opened TymeBank say that only 420,000 accounts are actively used. Still, what an amazing year it has been. So far, TymeBank have been mainly focusing on taking deposits and facilitating cash withdrawals. Since they have weathered the tricky brand establishment phase they are now set to make a dramatic shift next year.
Big Plans For 2020
TymeBank is now going to be switching its focus from just opening accounts and building brand awareness to beginning to offer clients unsecured loans during 2020. Many of their clients are low income earners. In fact, discussing the bank’s exposure to the pending debt intervention process, the bank says that around 50% of all their clients fall into the profile of consumers who would potentially qualify for debt intervention.
Other banks have already begun to try to avoid lending to these segments of the market in an effort to avoid exposure. TymeBank however are hungry for new clients see a gap where others see risk.
On the topic, TymeBank CEO Tauriq Keraan says: “we will go into this market in a slow, controlled and responsible way”. This seems a logical approach. Slow and steady to avoid too much risk while starting to build a debtors book.
2020 looks to be a big year for the bank as they branch out into other markets as well. TymeBank also plan to launch a small business account as well as a credit card through its partnership with RCS next year.
Signing up Another 2 million Users?
TymeBank wants to have a loan book of R2 billion by 2022. This is rather ambitious, given that it would then represent around 1% of SA’s total unsecured lending market. The banks CEO says that they want to try grow their customer numbers to 3 Million by 2022 as they chase this figure. This is part of the bank’s overall plan to break even during 2022. Of course, with the bank entering the lending space it now means that they will have to ensure that they have resources in place to deal with debt review applications which are bound to arise (regardless of what happens with debt intervention).